Legislation issued in 2013 has provided HM Revenue & Customs (HMRC) with new powers to request data from Merchant Acquirers. Merchant Acquirers are financial institutions that process all credit and debit card transactions on behalf of UK businesses. There are 8 major Merchant Acquirer businesses operating in the UK. HMRC has now received the first sets of data from the Merchant Acquirers providing monthly credit and debit card income from UK businesses.
How HMRC uses the data
HMRC matches the data from Merchant Acquirers against taxpayer records to identify people who fail to report, or deliberately under-report, their business income.
Why HMRC checks data
HMRC uses the data to:
- check businesses are declaring all of their income
- increase their understanding of the behaviours and compliance profile of businesses who receive credit and debit card income
- improve fraud detection
What you should do about this
If you’re already declaring the right income you don’t need to take any further action. If your business accepts credit and debit cards and you’re not confident you’re declaring all your income you need to check your processes. If you have a business adviser or agent then you may want to talk to them about this.